Going as far as a ‘national strategy office’ is sufficient. We had better not fumble around by detaching the budget bureau from the finance ministry and creating a kind of budget office under the direct control of the prime minister. (Revising the laws) would take half a year, and in the meantime the government would break down.

There is a certain wisdom to Fujii’s advice, at least as a DPJ government’s first year in office goes. And it is worth listening to, for, as Sankei hints, Fujii could end up as finance minister despite not standing for reelection this year. Indeed, as a MOF OB (and Ozawa confidante) Fujii probably has the inside track on the finance portfolio.

Should the DPJ win this month, winning an absolute majority in the 2010 upper house election has to become its top priority. Any steps that interfere with the government’s ability to move legislation that will enable the DPJ to stand before the voters in 2010 having made some progress in implementing its manifesto is detrimental to the goal of ensuring that a DPJ government survives. Whether or not a battle over the budget bureau would actually paralyze the government, it is a risk that the DPJ will not be willing to run.

Accordingly, it is entirely possible that the DPJ will soft pedal administrative reform during its first year. The DPJ would, of course, pass legislation creating a national strategy office (henceforth NSO) during this year’s extraordinary Diet session, but the NSO, intended to replace the Council on Economic and Fiscal Policy (CEFP) is not the radical change that relocating the budget bureau would be. At the same time, the DPJ appears to be looking for ways to build relationships with senior bureaucrats, a change in tune from calls for “loyalty tests” for senior ministry officials. The Sankei article notes that in addition to the meeting with Tango Yasutake, the administrative vice-minister of finance, mentioned in this post, senior officials from the MOF, MOFA, METI, and an unnamed fourth ministry met with senior DPJ Diet members in late July to discuss this year’s supplemental budget and next year’s budget. The finance ministry has also been meeting surreptitiously with Party President Hatoyama Yukio and Secretary-General Okada Katsuya. The impression I get is that both the DPJ and senior bureaucrats are eager to ensure a minimal level of continuity should the DPJ take power later this month.

I see no problem with this, at least as a short-term strategic decision. The bureaucracy’s position of strength was not built in a year, and it will not be dismantled in a year. In the meantime, the DPJ will need allies in the bureaucracy, especially in order to limit the bureaucracy’s ability to undermine the party’s other policy programs. I do hope that budget authority is eventually wrested from the bureaucracy’s hands, but I recognize that successful revolutions take time and usually involve the slow process of changing customs, norms, and ideas in addition to changing institutional structures. I do think Nakagawa Hidenao — who has been writing of the DPJ’s “abandoning the ‘abandoning Kasumigaseki’ line” — is deeply unrealistic when he writes of the DPJ’s shift to an “appeasement line” on administrative reform. Appeasement, when stripped of its negative connotations, often amounts to recognizing one’s limitations in implementing a certain policy approach. Appeasement can go too far, of course, but for a DPJ possibly on the verge of taking power to look for ways to ameliorate the bureaucracy’s concerns and possibly co-opt certain senior officials is prudent politics.

Interestingly, Machimura Nobutaka, Nakagawa’s fellow Machimura faction member, criticized the DPJ’s administrative reform plans in a way diametrically opposed to Nakagawa Wednesday: he argued that “political leadership” in the form desired by the DPJ would be “iron fisted.”

At this point in time Japan could probably use some “iron-fisted” government, after years of the LDP’s weak hand. In looking for ways to cooperate with the bureaucracy to achieve its goals, the DPJ may be coating its iron fist in velvet, at least during the first phase of its government.